The markets reacted in predictable manner post RBI surprise rate hike. The financials, realty and auto stocks bore brunt of the selling, while metal stocks too tumbled at close. The Sensex finally ended with a loss of 168 points at 17,411.
The markets were rallying for the last six weeks, and probably needed a reason to correct. The RBI rate hike could just be the trigger. Since the major indices are trading way above its short- and medium-term moving averages. A correction to the said levels should be on expected lines.
The short-term (20-days) moving average of the Sensex is at 16,965, and the medium-term (50-days) moving average is at 16,780. Today, the index may face resistance around 17,495-17,550, while seek support around 17,325-17,275.
The NSE Nifty may face resistance around 5,235-5,250, while seek support around 5,175-5,160.